In August 2008 China inaugurated its first high-speed line, and today, 13 years later, the Chinese already own two thirds of the entire global high-speed rail network. With plans for all its cities with at least 500,000 inhabitants to have bullet trains available by 2035.

This type of rail transport, which emerged in the 1960s in Japan, is becoming increasingly popular in the 21st century thanks to its efficiency, speed and because it is more sustainable than air and road transport.

However, investment in bullet trains is extremely expensive and construction usually takes time to complete, as for example in the United States, which despite being the world’s greatest power has only one high-speed line and a second proposal in California, to connect Los Angeles to San Francisco. It was started in 2015 and is expected to be completed only in 2029.

In this article we will understand how the Chinese government managed to expand its rail network so quickly, surpassing other countries with long traditions in rail transport, and the interests behind the massive investment in this transport.

What was China like before the Bullet Train?

To understand this policy we need to look at China’s Modern History, the rapid development from the 1990s that made China the world’s industry and the second largest economy on the planet, is strongly linked to high investment in infrastructure, with the Chinese economy being the most dependent on investment spending among the world’s large economies.

How Much of China’s GDP Comes from Investment?

With almost forty-three (43%) per cent of the nation’s GDP coming from investment, this factor has been and continues to be fundamental to Chinese growth, as cities that in the 1980s few would have heard of, today are large metropolises built on trade and abundant and cheap labour.

When Did High Speed Trains Start in China?

The basis for this growth is infrastructure, especially since 2009 with high speed trains. At that time, in response to the 2008 financial crisis, the Chinese government decided to prioritize the modernization of its railway infrastructure, aiming to create millions of jobs and boost the demand for concrete and steel.

How big is China’s High Speed Rail Network?

Today, 12 years later, the high-speed rail network is 38,000 km long and connects almost every major city in China, making it easier for more than 2.2 billion people to get around annually. This achievement is even more impressive because China has the longest high-speed route in operation in the world between Beijing and Guangzhou, with a length of over 2,298 km.

What is the fastest train in the world?

In addition to the recent inauguration of the Maglev Train in China, which is the fastest in the world, reaching speeds of 600 km per hour.

With that comes the first question:

Why does China have investment in three bullets as a government priority?

The main reason is political because the idea of the Chinese communist party is to unify the country and repress separatist movements, something that becomes more feasible with railways that unite the entire country. An example of this is the $26 billion high speed railway line between Lanzhou or Ürümqi, the capital of Xinjiang, a province where part of the population is composed of an ethnic Muslim minority with strong separatist sentiment. The result has been a great white elephant, since the annual financial return has been insufficient even to cover the cost of electricity, which shows that the idea behind this construction is very much linked to keeping Xinxiang under the control of the central government.

Another important reason would be demand, as with 1.3 billion people,s 28 per cent of all manufacturing output in the world, plus an economy that has grown almost 12 times since 2000, it is natural to the growing demand to move people and products quickly.

What Portion of the Chinese Population Live in the Countryside and in the City?

Such demand is even greater with rapid urbanisation since the 1990s, when previously only 23 per cent of the population lived in urban areas, while today that figure has risen to 64 per cent, making China have 102 cities with more than 1 million inhabitants, compared to 35 across Europe and 10 in the United States.

And so the second question arises:

How has China managed to build so many high-speed lines while other developed countries have not?

In this case, it is important to consider the priority that the country places on the issue and the characteristic of the Chinese government. Initially the trains were imported or built through foreign technology transfer, but as in other technology sectors, China managed to quickly develop the technology of the railway sector and today is one of the main leaders in the world market, besides standardizing the projects and construction processes, such as viaducts and tunnels, which reduces costs and construction time.

What is the cost of land acquisition in the construction of Chinese Railways?

Some other factors are also essential in reducing costs, such as cheaper labour than in developed countries and the Railway network that crosses mostly rural areas, where much land is government owned and the price of private land is cheaper. Making the cost of land purchase only eight (8%) per cent of the total project cost, compared to twenty (20%) per cent in the United States.

What is the cost per kilometre to build a High Speed Railway?

This Chinese advantage becomes even more evident when in the country the cost of building a high-speed railway is around 17 million dollars per kilometre while in Europe the cost reaches 39 million dollars. In the United States, the cost is even higher, at US$54 million per kilometre.

Competition is also an important factor because in Europe for example, there is a large availability of low cost airlines such as easyJet and Ryanair, where tickets below 15 dollars can be easily found. Meanwhile in China airfares are usually much more expensive for similar distances, making the price of rail travel relatively similar to air travel.

Although the travel time is slightly longer, the time lost to check-ins and other airport bureaucracy makes using bullet train competitive, both for price and time.

How much of China’s airspace is available for civil aviation?

Moreover air transport in China is notorious for delays as most of the airspace is controlled by the military, leaving only thirty (30%) per cent of ALL Chinese airspace is available to civilian aircraft, compared to eighty (80%) per cent in the United States, which ends up creating a great deal of air traffic congestion in the country.

In the Chinese Rail case, the and go far beyond the profit because, although China RailWay Group, the Chinese construction company showed a profit of 4.1 Billion Dollars in 2020, the benefit to the population is huge as it brings reduced travel time, increased safety and facilitates urban mobility.

Which are the most expensive cities in China?

The ease of commuting with bullet trains also helps the development of large cities, because with 4 of the 10 most expensive cities in the world in terms of rent, being Hong Kong, Beijing, Xianjiang and Shanghai, it is crucial that the population living in the suburbs, where rent is cheaper, are able to move quickly to work and study.

Another important point is the increase in tourism in smaller cities that used to take hours to reach and now with the railway lines, these can be reached in a much shorter time.

So, and China has shown itself capable of developing a huge high-speed rail network in just over a decade, and the effects of this priority placed by the Chinese government are being extremely positive for the rapid development of the nation, especially for the East, which is the country’s main economic region.

However, the effects of loss-making lines and China RailWay’s debt, which has already exceeded 850 billion dollars, are worrying factors for the country to continue with its impressive expansion that has aroused so much interest in the accident.